Economic data indicates a contraction in the private sector of Hong Kong during January, according to the recent survey by S&P Global, which revealed a PMI (Purchasing Managers' Index) score of 49.9. This is a decline from 51.3 in December, indicating that the sector has slipped below the critical threshold of 50, which demarcates expansion from contraction.
Private sector firms in the Hong Kong SAR (Special Administrative Region) experienced a decrease in new business at the start of the year. This included declining orders from both international and mainland China sources, highlighting an unfortunate combination of internal and external economic challenges affecting sales. The decline rates of new export orders, as well as new Chinese orders, were markedly more profound than those recorded in December, suggesting a worsening demand situation.
On the brighter side, private sector output in Hong Kong slightly increased in January. Firms, aiming to utilize their existing orders, led to a fourth consecutive monthly drop in the quantity of backlogged work across the private sector in the Hong Kong SAR.
